ORM contract sold a third time since privatization amid rumors of attempts to rig bids in favor of FARA renewal

Some things never change when it comes to doing business with the State of Louisiana.

Several business owners have, over the past couple of years, told LouisianaVoice they would never bid on a state contract because, they said, the bid process and contracts are rigged, or at least weighted, heavily in favor of pre-selected vendors.

Now, three separate sources have come forward to offer specifics that support that claim as it regards a request for proposals (RFP) for renewal of an existing $75 million contract.

One of our very first stories under the LouisianaVoice banner was the manner in which Gov. Bobby Jindal went about privatizing his very first state agency, the Office of Risk Management (ORM), throwing nearly 100 employees out of work in the process.

Now we learn the story of F.A. Richard & Associates (FARA), the Mandeville company the state initially paid $68 million to take over as third party administrator (TPA) of ORM has taken yet another interesting twist.

Well, make that two interesting twists—including a third violation of the original contract between the Division of Administration (DOA) and FARA and now it seems there may be a strong case made for bid manipulation on the part of the state.

The reason we said the state initially paid $68 million is because eight months after that 2011 takeover, FARA was back asking—and getting—an amendment to its contract which boosted the contract amount by exactly 10 percent, or $6.8 million, bringing the total cost to just a tad under $75 million. An obscure state regulation allowed a one-time amendment to contracts for up to (drum roll, please)…10 percent.

Then, less than a month after the contract was amended by that $6.8 million, FARA sold its state contract to Avizent, an Ohio company, which kept the contract for about four months before it sold out to York Risk Services Group of Parsippany, New Jersey.

Last month, it was announced that Onex Corp., a Toronto-based private equity firm, had finalized a deal to acquire York for $1.325 billion.

In each case, the name FARA was retained “for branding purposes,” according to one former FARA employee, but there was no getting around the fact that the state’s contract was—and is—being shifted from one company to another until the latest deal that placed in the possession of a foreign corporation.

The original contract with FARA stipulates that the contract may not be sold, transferred or re-assigned without “prior written authority” from DOA.

LouisianaVoice, of course, made the appropriate public records request for that “prior written authority” right after it was sold the first time—to Avizent. After the usual delays in responding, DOA finally sent us an email which said no such document existed.

So, now we a contract the very specific terms of which have openly violated not once, not twice, but three times and the state has remained silent on this point.

Jindal, in case you need a reminder, is the same Louisiana governor who only last Friday criticized President Obama of “flaunting the law” in his executive action granting amnesty to illegal immigrants.

But as bad as the contract shuffling might be, ongoing efforts to rig the bidding process for a renewal of the five-year contract in FARA’s favor would appear to be far more serious.

Three separate sources—one employed by DOA and the other two former employees of first ORM and, after ORM was privatized, FARA, said that FARA had been requested to assist in drafting a new RFP in such a way as to guarantee that FARA would retain the contract.

Both former FARA employees, interviewed separately, said a staff meeting of FARA employees was held in Lafayette last April and again in May. On both occasions, they said, FARA management assured them that the company had been asked to assist ORM in drafting the RFP and that FARA was certain to win renewal of the contract, which expires next July 1.

“We were all told to update our resumés so they could be used in beefing up FARA’s proposal,” said one of the former employees.

If true, that would constitute bid rigging in almost any law book and should prompt an immediate investigation. This would be an ideal opportunity for someone to awaken East Baton Rouge District Attorney Hillar Moore to see if he is up to performing his duties.

Wasn’t that, after all, the basis for the investigation of Bruce Greenstein and the $189 million contract to his former employer, CNSI? That was the investigation that led to his nine-count indictment for perjury.

Having said that, if there are any other business owners who have had unpleasant experiences in bidding on state contracts, or who feel they have been shut out of the process through favoritism we would love to hear from you. Our email address is: louisianavoice@yahoo.com or louisianavoice@cox.net

16 Responses

Enough is enough. When is the DA gonna indict these sorry ass criminals? This is truly pathetic. Jindal, Edmonson, Kristi Kreme Nichols, and Susan West should all rot in a prison cell. This state will never change, it’s truly sad!!!

To call Kristy Nichols and Susan West criminals is a bit over the top. While we may not agree with their policies, neither of these people, to our knowledge, has committed any crimes. For that matter, we don’t know if any criminal activity on the part of Edmonson and Jindal—other than Jindal’s taking tainted money for his campaigns and rewarding the donors with prestigious appointments. Let’s keep the rhetoric on a more sophisticated level.

Caldwell has a constitutional requirement to defend the Jindal administration against lawsuits, and I think that fact has placed him positions to appear both foolish and Hapless.

Having said that, Caldwell is perfectly capable of making himself look foolish without any help from Jindal. I can tell you that I have filed complaints with Caldwell’s office entailing REPEATED flaunting of Louisiana’s Open Meeting Laws by the Actioneer’s Licensing Board and the Interior Design Board, and I’ve provided extensive credible evidence that, in the case of the Interior Design Board, a clandestine meeting was conducted on 11/17/11 to execute an agreement permitting it’s sole employee to commit payroll fraud (and they were subsequently cited by the State Inspector General that she was committing payroll fraud).

Caldwell’s office just yawned and relayed they’d be doing nothing but said I was free to initiate my own civil action against either board. As far as I’m concerned, Caldwell’s office has aided and abetted corruption by state agencies by demonstrating indifference to Louisiana’s Open Meetings laws, which are laws they are supposed to enforce!

That, in my opinion, makes Caldwell’s office even more corrupt than them. Hence, I was not surprised when Caldwell’s office said it “wouldn’t get involved” in what Tom reported about a month ago entailing the Secretary of State’s claim that OGB records were being prematurely destroyed.

Caldwell is tough on child porn, and I commend him on that, but who isn’t going to be strongly supportive of those efforts. He’s not willing to protect the citizens against abuses by state agencies, however, so I do not think he is fit to hold that office and has WAY overstayed his welcome.

Robert, as you know, the AG is the state’s attorney. Therefore, his office is supposed to defend state agencies against charges, including violation of open meetings laws. Many boards and commissions fall in a very gray area in that they put on the mantle of the state when it suits their purposes and take it off when it doesn’t. I am aware of the AG issuing non-binding opinions to boards and commissions, just as he does to mainstream state agencies, so I assume he defends those that have statutory authority just as he does other state agencies.

The AG does not represent Louisiana’s private citizens in complaints against the state or its agencies – quite the reverse.

The AG does provide services that benefit the general public interest in private sector matters. At one time the AGs consumer protection unit very aggressively represented citizens in actions against private businesses. As you point out, the AG investigates child crimes committed by private citizens and can become involved in cases ordinarily handled by DAs in certain circumstances. His Medicaid fraud unit is VERY effective in recovering money from private providers collecting on fraudulent claims.

I have had people who should know better ask me why the AG doesn’t go after the governor. The answer is obvious. He is the governor’s lawyer.

I can certainly appreciate what you’re saying, Stephen, but when I tell you Caldwell’s office can embarrass itself, I’m not joking.

I keep an “embarrassment” index on LAPA’s webpage, and two individuals outlined are Caldwell’s folk for whom I provide videos to back up my contention.

In one instance, Joseph “Beaver” Brantley, who served as Ken Buhler’s defense attorney at an LALB hearing, up and decided he wanted me to testify even though I’d been issued no subpoena and had never been informed I would be expected to testify. Nevertheless, Brantley requested an “instanter subpoena,” which AG Assistant Attorney General Lindsey Hunter arbitrarily granted!! Once sequestered, I telephoned Robert Chadwick at the Inspector General’s Office since they were conducting an ongoing investigation of suspected payroll fraud. He informed me they did not want me testifying, period! I then called my own attorney, and he said, “If you weren’t issued a written subpoena, leave. There’s nothing they can do!” Well, Ms. Hunter hauled off and advised the LALB to seek recourse against me in 19th JDC for “failing to comply with the subpoena.” I defended the action myself, and Judge Hernandez essentially laughed it right out of the courtroom, but the LALB spent $2,300 in its ill-conceived pursuit. Here’s a webpage for the incident: http://www.auctioneer-la.org/embr_hunter.htm. The video is WELL worth watching!!!!

In another incident which occurred before the above incident, the LALB opted to conduct a “hearing” regarding my role in reporting the payroll fraud. They accused me of “going after” its sole employee. In that instance, I made it known to my attorney, Robert Loren Kleinpeter, that any “deliberations” regarding me were to take place in an open meeting pursuant to LA R. S. 42:17(A)(1), which I have memorized and, being blunt, even Kleinpeter wasn’t familiar with (I had to educate him in the break room). Nevertheless, when it came time for deliberations, Assistant Attorney General Michael James Vallan, speaking as if he’s an authority on Open Meetings Laws, granted the Board the permission to convene an ILLEGAL EXECUTIVE SESSION!! Here’s the webpage for that embarrassment: http://www.auctioneer-la.org/embr_vallan.htm.

Now, I did sue the LALB over that second incident, and I represented myself, and the trial transpired on 4/9/14 before Judge Fields, who ruled against me relaying that he “didn’t feel my character was discussed and, even if it was, the Board was absolved of liability due to the fact the AG’s Office granted them permission to convene the Executive Session.” The case is presently pending before the First Circuit Court of Appeals. Here is a webpage link for ALL of the filings from beginning to date on the matter: http://www.auctioneer-la.org/LALBom2.html. Obviously, case law will be made from the incident, but my rights CANNOT be dismissed based on erroneous knowledge and guidance of one of Caldwell’s underlings!!

It was also ultimately the AG’s Office who is responsible for sending the Terrorism Unit of State Police to my home. The LALB was becoming so paranoid that I would nail them on the payroll fraud that Ms. Anna Dow, the then-only LALB attorney, stated to AG CIVIL Attorney Rick McGimsey that she felt I was “engaging in stalking-like behavior” (I have sued her for defamation for her remarks with that case pending before Judge Caldwell). Accordingly, as per Dow’s own sworn affidavit (see page 4 of this link http://www.auctioneer-la.org/AG_Internal_Investigation_Request.pdf ), she contacted HER FRIEND in the AG’s Office, Mr. McGimsey, and he suggested that Louisiana State Police be contacted! When I asked for an internal investigation of the whole matter within the AG’s Office (see first three pages of prior link), this is the TOTALITY of what I got back from the AG’s Office: http://www.auctioneer-la.org/AG_iiresponse.pdf. Now, I don’t have so much as a speeding ticket on my record going back to 1991 (when I did get my last speeding ticket from State Police), and out comes the Terrorism Unit of State Police based solely on ONE SENTENCE which is utter horse manure uttered by an admitted-friend of Rick McGimsey which is so outlandish it’s not even worth dignifying!!

So Louisiana Voice readers will just have to forgive me if I don’t have a very “warm and fuzzy feeling” where it concerns AG’s office’s operations. Having read the above, I would hope that any objective person would share my concerns!

My guess is a large contribution to a Jindal campaign or super PAC will be forthcoming immediately following a successful FARA bid. And Edwards went to jail over a hundred thousand dollar riverboat license bribe. Where are the feds now?

Part of the problem is that FARA has accepted liability for those not intended coverage under state law. Why would a private entity cover someone that wasn’t entitled to coverage unless it was politically expedient to do so? They can always go back to the legislature and ask for more money with Jindal’s full support. The savings that were supposed to occur never materialized but a new vehicle to handle the administration’s problems, reward its friends, and punish its enemies did.

Wow, Mr Root, why are you so evil that you would wish someone would rot in a prison cell. I don’t know any of those you mentioned personally, but I do believe that Ms. West has been a long time state employee that apparently has an excellent record of credibility and honesty. Besides, what does this post have to do with her?

Just like Ferguson, instead of working to change the system, you want to burn it down along with all the hard working employees trying to make this a better state to live in and work.

Susan West first worked as a medical malpractice adjuster, then started handling Hurricane claims as ORM’s property manager dealing with independent adjusters and some state and federal representatives due to the spending of state vs federal funds. She then became the underwriting manager @ ORM, she held another job briefly and then transferred to OGB as their director, we don’t have much knowledge regarding her background and qualifications needed to fill this appointments. She is a college graduated and received a MBA from LSU.
(which she places after her name when sending out correspondence )

Buddy had no problem going after Greenstein and I don’t remember Greenstein threatening a state agency will legal action. In fact, Buddy didn’t get on board until after it became apparent he had overlooked the alleged wrongdoing by Greenstein!

Exactly, Stephen!! That’s the ONLY reason he went after him. I’ve posted ad nauseam on that angle in prior posts, so I won’t repeat it here other than to relay I believe the end result will be no conviction on Greenstein (thus likely a big tab for his defense costs for taxpayers to pick up as just like with Painter) and a big civil judgment to CNSI because Jindal was WAY too premature in canceling that contract when he merely thought it may harm his self-generated perception that he’s above reproach without even a hint of impropriety.

What motive does Caldwell’s office have when they are the attorney’s handling and billing on FARA’s claim files,( from workers compensation to general liability etc) Maybe someone needs to speak with Mr. F. Thompson at ORM for answers regarding the selling and buy-out of the original companyFARA. One wonders what is stated in the contract regarding to the buying and selling companies owned by a foreign company and others.

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